Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Valvoline fuels retail drive with $2.65 billion lubricants unit sale to Saudi Aramco

Commodities Aug 01, 2022 01:55PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. FILE PHOTO: Saudi Aramco logo is pictured at the oil facility in Abqaiq, Saudi Arabia October 12, 2019. REUTERS/Maxim Shemetov

(Reuters) -Valvoline Inc is selling its unit that makes lubricants, coolants and other automotive products to state-owned Saudi Aramco (TADAWUL:2222) for $2.65 billion in cash to sharpen focus on its retail services business.

The deal announced on Monday builds on the company's plan to separate the two units, with the sale proceeds set to fuel an expansion of the vehicle service center business Valvoline (NYSE:VVV) operates across the United States.

For Aramco, it deepens a bet on the long-term demand for petrochemicals. The oil giant has been expanding its presence in the sector, known as downstream, and bought petrochemical maker Saudi Basic Industries Corp in 2020.

Valvoline shares rose nearly 4% in premarket trading, while Aramco was a tad higher.

"Valvoline's Global Products business fits perfectly with Aramco's growth strategy for lubricants as it will leverage our global base oils production, contribute to R&D capabilities and strengthen existing relationships with OEMs (original equipment makers)," said Mohammed Qahtani, senior executive at Aramco.

The business brought $1.76 billion in revenue last year, accounting for nearly 60% of Valvoline's sales, and is forecast to grow 24% in the third quarter.

Valvoline said it would also use the sale proceeds to accelerate share repurchases and reduce debt.

Aramco will own the Valvoline brand for all product uses globally, though the Lexington, Kentucky-based company will continue to procure motor oil and related products from the lubricant business through a long-term supply deal.

Valvoline fuels retail drive with $2.65 billion lubricants unit sale to Saudi Aramco
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email